The recent upgrade of Greece’s Long-Term Foreign-Currency Issuer Default Rating from BBB- to BBB by Fitch is more than a technical pronouncement detached from the real-world. It is a milestone in our long, uneven journey out of uncertainty and signals that the eras of crisis then recovery are now giving way to a new epoch in our economic and social history: one based on resurgence.
To understand the significance of this moment, we must confront how we arrived here. Our entry into the EU in 1981 brought genuine optimism. Access to European markets and funding accelerated development and opened paths to modernisation. But it also bred a comfortable complacency. Instead of directing European loans toward transformative investments, successive governments poured them into wages, pensions, and consumptive expenditures that grew the state but not its long run capacity to innovate.
This - coupled with our inability to devalue our currency to increase exports because of our euro ascension - meant we borrowed our way towards the illusion of prosperity. Although the structural cracks in our economy went further back, what followed at the turn of the 2010s saw the fiscal house we had built on sand crumbling before our eyes.
Our budget, once a symbol of disfunction, has turned a corner and we are expected to be in 1% surplus this year - even with tax cuts planned for 2026
The reckoning came in 2009, when our budget deficit was revised upwards from 6% of GDP, to more than 15%. This did not just affect the spreadsheets. Confidence in our economic credibility evaporated overnight. Within a few years, queues outside banks would become an emblem of our collapse. We became a cautionary tale - the country that nearly toppled the currency it had fought so ambitiously to join.
Today however, Greece is now moving not only beyond this, but also out of our recovery phase. Fitch now forecasts that our debt will fall to 145% of GDP this year, down from a staggering 209% just five short years ago. This is the steepest post-pandemic decline among all Fitch-rated countries. Meanwhile, debt is projected to continue falling to roughly 120% by 2030, driven by sustained GDP growth and a pragmatic approach to public finances. Our budget, once a symbol of disfunction, has turned a corner and we are expected to be in 1% surplus this year - even with tax cuts planned for 2026.
Growth, too, is working in our favour. GDP has averaged around 2% since 2023, outpacing our eurozone neighbours. Domestic demand is driving this trend, supported by investment inflows and tax cuts as well as the overall relative stability achieved since 2019.
Investment levels in the country are at 40% above pre-COVID levels in real terms – and from 2019 – confidence in our economy has been transformed
None of this is a coincidence. Since Kyriakos Mitsotakis’ election as Prime Minister in 2019, New Democracy have pioneered a number of reforms to put us back on the map. Investment levels in the country are at 40% above pre-COVID levels in real terms – and from 2019 – confidence in our economy has been transformed. Recovery – from our precarious position the decade before – is now evolving into wholesale resurgence.
The countries that once lectured Greece on fiscal discipline may now find themselves looking up at us in certain metrics. However, we must remember that the rating upgrade is not a destination. It is an opportunity - one that history, and the recent exploits of our close neighbours - has taught us we cannot squander. We cannot forget that our debt-to-GDP ratio, though improving, remains the highest in the EU and our current account deficit – which sits at roughly 6% of GDP - is far above the median for countries with our credit rating.
Now cannot be a time for renewed complacency or for falling back into old, bad habits. Instead, we must continue to embrace reform and resilience if we are to achieve resurgence on a global stage. The Fitch upgrade is proof that the world believes Greece is changing. The responsibility rests with us to ensure that this belief is not misplaced.
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